The Katan Group is again taking legal action to have greater say over the fate of the Domino Sugar Factory development site it owns with CPC Resources. The New York Observer reported that Katan Group filed a lawsuit to block the contracted $180 million sale of the site to Two Trees Management.
And, like similar recent actions, the firm is claiming partner CPC Resources did not “engage in a process to maximize value,” when pursuing the sale. Katan said Joseph Chetrit was willing to pay as much as Two Trees, Sage Capital was willing to pay $10 million more and a firm called Heritage was offering $200 million for the development site.
As previously reported, Two Trees purchase price was upped to $180 million, from $160 million, following similar complaints by Katan. In court documents, Katan argues that the increased offer was merely an effort to counter that of Chetrit. CPC should have parlayed the bidding war into a higher price, Katan said.
The plaintiffs also say the deal with Two Trees came with a 131-day closing period, which costs the current owners more money because “mortgage interest continues to accrue at the rate of over $1.5 million per month.”
CPC was compelled to sell the site because it faced financial difficulties in the wake of boom-time lending. [NYO] — Adam Fusfeld